The favorite-longshot bias describes the longstanding empirical regularity that betting odds provide biased estimates of the probability of a horse winning - longshots are overbet, while favorites are underbet. Neoclassical explanations of this phenomenon focus on rational gamblers who overbet...

A rich but tractable variant of the Burdett-Mortensen model of wage setting behavior is formulated and a dynamic market equilibrium solution to the model is defined and characterized. In the model, firms cannot commit to wage contracts. Instead, the Markov perfect equilibrium to the wage setting...

Using data on the valuation of Christmas gifts received by students in different fields at a German university, we investigate whether the endowment effect differs between students of economics and other respondents and whether it varies with the market price of the object under consideration....

We investigate the matching algorithm used by the German central clearinghouse foruniversity admissions (ZVS) in medicine and related subjects. This mechanism consists ofthree procedures based on final grades from school ("Abiturbestenverfahren","Auswahlverfahren der Hochschulen") and on waiting...

I examine the effects of globalization in countries where the employed workers support the unemployed and the governments control wages by regulating the workers' relative bargaining power. I use a general oligopolistic equilibrium model of two integrated countries with two inputs: labor and...

This note introduces a maximum likelihood estimator of the value of job amenities and labor productivity in a single matching market based on the observation of equilibrium matches and wages. The estimation procedure simultaneously fits both the matching patterns and the wage curve. Our...

We study communication in committees selecting one of two alternatives when consensus is required and agents have private information about their preferences. Delaying the decision is costly, so a form of multiplayer war of attrition emerges. Waiting allows voters to express the intensity of...

We investigate the role of marital patterns in explaining rising income inequality using a structural marriage matching model with unobserved heterogeneity. This allows us to consider both the extensive and intensive margins of the marriage market, i.e. who remains single and who marries whom....

This note investigates the extent to which structural estimates of marital surplus are informative about subjective well-being and separation. We first estimate the marital surplus using a simple matching model of the marriage market with perfectly transferable utility and heterogeneity in...

In this article, we use a stylized model of the labor market to investigate the effects of three alternative and well-known bargaining solutions. We apply the Nash, the Egalitarian and the Kalai-Smorodinsky bargaining solutions in the small firm's matching model of unemployment. To the best of...